Some New Year cheer: Price of petrol set to drop by as much as 34c

This, in spite of a spike in international oil prices during December.

File photro: Gene J Puskar / AP

Johannesburg – Just when they need it most after the extra expenses of the holiday period, motorists can expect a significant reduction in the price of fuel from the first Wednesday in January 2018.

This despite increases in international oil prices during December, according to the Automobile Association’s analysis of unaudited month-end fuel data released by the Central Energy Fund.

The AA expects the price of petrol to fall by as much as 34 cents a litre, diesel by 26 cents a litre, and illuminating paraffin by 28 cents.

“The Rand has had a very strong run against the dollar since the middle of the month,” the AA said on Thursday, “gaining considerable ground after the ANC’s electoral conference chose Cyril Ramaphosa as the new leader of the party.

“After opening the month at R13.80 to the dollar, the Rand is now testing the R12.30 level.”

The AA commented that the rand – and, by extension, fuel prices – have been vulnerable to political developments in South Africa over the past year. The strongest factor in determining fuel prices up to the February 2018 budget speech, it said, is likely to be Ramaphosa’s position on fiscal discipline, rather than oil prices or global politics.